GM’s buyout falls short
Posted on August 3, 2009 at 12:52 pmAnd the auto maker may have to lay off more than 7,000 hourly people to meet its previously stated goal of reaching 40,500 people.
G.M.’s contract with the U.A.W. calls for hourly workers who are laid off to receive most of their pay through a combination of state unemployment benefits and supplemental pay from the company, though the union recently agreed to shorten the time that assistance was available.
The birth of Government Motors
Posted on May 31, 2009 at 10:54 pm
This morning’s bankruptcy filing by the largest of Detroit’s Big Three will trim its shareholder base to four groups: The U.S. government (60 percent), the UAW’s health trust (17.5 percent), the governments of Canada and Ontario (12.5 percent) and bondholders (10 percent).
Other nuggets on this topic:
Bloomberg News on the new company’s expected world view:
The new GM would emerge armed with vehicles from its Cadillac, Chevrolet, Buick and GMC units. It will be built to survive on 10 million annual car sales, the Obama administration said. That’s down from the present break-even sales of 16 million vehicles. GM intends to close 11 factories and idle an additional three, while attempting to reopen one idled facility to build a new small car.
Reuters via CNBC gives the skeptics some time at the mic:
“I don’t think they’re going to be successful in answering the fundamental problems of this company — they are addressing the financial issues, but not the business issues,” said Stuart Hirshfield, a bankruptcy lawyer with the Mintz Levin law firm.
And this pithy quote:
“I think this is going to be Obama’s Vietnam,” said automotive historian Bob Elton. “Every time he turns around, there goes another $20 billion.”
Might those next $20 billion go to suppliers? The Journal takes a look at the dominos of a Chapter 11 filing:
It’s possible struggling suppliers will get indirect help from the government through GM in the form of a more payments to suppliers than might be the case in a traditional bankruptcy. A person familiar with the Treasury Department’s discussions expects more suppliers to file for Chapter 11 and said, “We will support GM — and Chrysler for that matter — in trying to make it orderly.”
The Washington Post on the union-investor tug of war:
“The proposal seems to favor the rights and claims of the UAW, a political ally of the current administration and a powerful lobbying force in Washington, over the rights and claims of the company’s diverse group of bondholders,” according to a letter from 20 House members, led by Rep. Jeb Hensarling (R-Tex.), to Treasury Secretary Timothy F. Geithner. “Contractual rights of investors are being trampled by the government under the rationale of ‘extraordinary circumstances.’”
An AP story in the Chicago Tribune examines the tax credits GM will be eligible for when (if) it turns a profit:
Decades ago, Congress severely restricted the ability of money-losing companies to cash in on the tax breaks if they are taken over by other companies. The goal was to discourage corporate takeovers for the principle purpose of avoiding taxes, Willens said.
The government, however, doesn’t want to penalize firms for participating in the taxpayer-financed bailout, so the Treasury Department has issued several notices in recent months creating exceptions for firms that get bailout money. Under the new rules, corporations can keep their tax breaks if the government becomes a majority owner.
And finally, the GM coverage by the Detroit Free Press includes a look at what might happen to the company’s iconic Renaissance Center HQ.
permalink | Comment on this post
Spring Hill workers vote for GM deal
Posted on May 29, 2009 at 6:17 amThe men and women of United Auto Workers Local 1853 have overwhelmingly approved the union’s proposed new deal with General Motors, which will give the UAW a stake in the company.
permalink | Comment on this post
GM: June bond payment unlikely
Posted on April 22, 2009 at 3:21 pmThe auto maker says it expects to still be in the middle of a bond-for-equity swap at the time – if it’s not busy in the bankruptcy courts.
If GM cannot convince enough bondholders to participate in the exchange and GM is forced into a Chapter 11 bankruptcy before that deadline, the automaker said it is unlikely it will make the $1 billion payment.
permalink | Comment on this post
‘Temporary’ closure at Peterbilt
Posted on April 14, 2009 at 4:42 pmWSMV reports:
Peterbilt Motors Company announced the temporary closure of its Madison facility, which has been on a work stoppage due to union contract negotiations.
Larry Vessels, the plant manager for the Denton, Texas-based heavy truck manufacturer, said due to a failure to reach an agreement with United Auto Workers, the facility has not been producing since June of last year.
More than 300 Spring Hillers take GM buyout
Posted on March 26, 2009 at 12:43 pm
The locals taking the cash to leave make up about 4 percent of the auto maker’s total cuts.
“This is another example of GM’s commitment to execute our Viability Plan. There is still much to do, but the Special Attrition Program, along with the many difficult but necessary actions we have taken in recent months will help ensure the long-term viability and future success of General Motors.”
Cowger noted that the UAW has been an important partner in GM’s ability to make changes to its business model. “And with the recently negotiated changes to the 2007 agreement, we will further improve our long term viability,” he said.
permalink | Comment on this post
Spring Hill GM plant starts back up
Posted on March 16, 2009 at 5:45 pmFrom WKRN:
Several hundred people returned to work Monday at the General Motors plant in Spring Hill.
“People are excited, glad to be back to work,” said Tim Standard with the UAW Local 1853. “Everybody wants to be working, they want to do a good job and we want to sell as many vehicles as we can.”
The plant temporarily suspended production two weeks ago because of slow sales.
It is the second time in recent months the plant has temporarily shut down.
permalink | Comment on this post
Auto deal collapses
Posted on December 11, 2008 at 11:31 pmWith Republicans pointing fingers at the UAW, talks to grant the Big Three car makers a $14 billion loan package hit a wall Thursday night.
Recent Comments
In our good state a select few run the place, 20 yrs ago and today....
Southernindie…Unfortunat ely you have suffered a dibilitating...
And…Karl (Marx) Dean is spending one billion dollars...
Someone explain the difference between short stay and observation...
Watching the Chairman of Starwood Hotels yesterday on CNBC...
Funny how the Union’s feel about taxes. They complained about their...
Where is it?
An absolutely ugly structure, which I have always thought did not take...
Too bad that ATT changed the look of the building so that it no longer...
Yeah, well, look at the TN Legislature of good ol’ boys and the...
As long as the red rules, we will be far behind other states. The GOP does...
Nissan CEO Carlos Ghosn: I don’t know what...